Yield Emission Mechanism

How is the yield distributed to OPB holders?

OPB is a token that lives natively on the Solana blockchain. More specifically it is created using the Solana Token-22 Program standard. Additionally this token implements the Interest Bearing Token Extension. This extension allows OpenDelta to set an interest rate that is applied continously to the token. This interest rate is represented as APY (anual percentage yield) in basis points. This mechanism allows OpenDelta to emit the yield collected by the basis trade backing OPB without holders having to stake it.

Yield Adjustment Intervals

OpenDelta adjusts the interest rate of the token every 24h at approximately 12 AM UTC. The adjusted interest rate represents the funding payments and basis returns collected over the last 24h. The new interested rate is calculated as follows:

$$\frac{\ln \left( \frac{s_{OPB} \cdot p_{OPB} - c_{OPB}}{s_{OPB} \cdot p_{OPB}} \right)}{86400} \cdot 31536000$$

, where s_OPB is the current supply of OPB, p_OPB is the current price of OPB, c_OPB is the notional value in USD backing OPB, 86400 is the number of seconds in 24 hours and 31536000 is the number of seconds in a year.

OPB Price

It is important to note that no new OPB is ever minted as interest is accrued. Rather the price of OPB continously increases according to the interest rate factor. That is, if you mint 100 OPB at a price of $1 you will pay $100 at mint time. If you redeem 100 OPB 24h later and the interest rate was set to 1000bps for this period, you will be able to redeem $100.027.

$$e^{\left(\frac{0.1}{31536000} \times 86400\right)} \times 100 \approx 100.027$$

End Of Day Price

Since the interest rate is accrued continously and rates are adjusted every 24 hours the expected price of OPB is the end of day price. Hence when new OPBs are minted the purchase price will always be the end-of-day price.